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Judgment
This petition of filed by the Management of the Presidency Talkies for the issue of a writ of certiorari under Article 226 of the Constitution
quashing the order of the second respondent, the Presiding Officer, Labour Court, Madras, directing the payment of Rs. 2,271.82 nP. to the first
respondent Mohammed Sheriff, a former employee of the petitioner. The prior circumstances which led to the filing of this writ petition can be set
down briefly.
(2) Four persons including the first respondent, Mohammed Sheriff, who were employed by the petitioner as ticket collectors, were retrenched.
The said workers and the management entered into a settlement, which was recorded in a memorandum, on 11-1-1961, of a dispute which arose
over the retrenchment of the four persons mentioned above. The memorandum recording the terms of the settlement states that the said workers
agreed to receive specified amounts in full settlement of their claims. The second clause of the settlement was that the workers gave up their claims
for reinstatement. The third clause of the settlement was that the workers should be given preference for reappointment within a period of one year.
Mohamed Sheriff, the first respondent, alleged in a petition, which he filed u/s 33-C(2) of the Industrial Disputes Act of 1947 before the Labour
Court, Madras, that in contravention of the third clause of the settlement the petitioner had employed five persons by name Shanmugam, Chandian,
Louis, Subramaniam and Ramachandran, without giving an opportunity to the first respondent for being appointed to the vacancy. The first
respondent alleged that the Government had ordered prosecution of the management for failure to implement the terms of the settlement. The first
respondent further alleged that on the complaint made by the Secretary of the South Indian Cinema Employees'' Association, the Assistant
Inspector of Labour, 19th Circle, Madras, had inspected the petitioner''s theatre in August 1961 and found the abovesaid five persons working
there. Therefore, the first respondent claimed in his petition u/s 33-C(2) of the Act before the Labour Court, that the wages from August 1961 to
April 1963 inclusive of basic pay and dearness allowance, which worked out to Rs. 2,271-81 P., should be ordered to be paid, to him as money
value of the benefit which would have accrued to him, if he had been employed by the petitioner in compliance with the third clause of the
settlement mentioned above. The Labour Court recorded evidence both for the worker as well as for the management, and by its order passed on
21-8-1964, held that the petitioner had employed three ticket collectors on 30-8-1961 without giving an opportunity to the petitioner, to take up
the employment, violating the third clause of the settlement, and that therefore the first respondent would be entitled to the payment of the amount
claimed. It is this order of the Labour Court that is attacked by the petitioner, the Proprietor of the Paragon talkies, in this writ petition.
(3) Learned counsel for the petitioner urged firstly as a preliminary ground, that the Labour Court had no jurisdiction u/s 33-C(2) of the Industrial
Disputes Act, 1947, to decide the present claim, as it would not strictly fall within the scope of Section 33-C(2). Secondly, he urged that even if
the petition is held to be maintainable u/s 33-C(2), the provisions for re-employment of retrenched workmen must be subject to the requirements,
provided in Section 25-H of the Act as well Rule 63 of the rules framed by the Madras Government under the Industrial Disputes Act, and these
requirements are not satisfied in this case. Section 25-H states that where any workmen are retrenched, and the employer proposes to take into his
employ any persons, he shall, in such manner as may be prescribed, give an opportunity to the retrenched workmen to offer themselves for re-
employment, and such retrenched workmen who offer themselves for re-employment shall have preference over other persons. Rule 63 framed by
the Madras Government states that the employer, on the occurrence of vacancies arising after retrenchment, shall give notice of vacancies arising
after retrenchment, shall give notice of vacancies in writing to every individual retrenched workman eligible to be considered for the vacancies, such
notice being despatched by registered post. The employer shall also send a notice to the registered trade union, of the arising of the vacancy. But
these requirements are subject to the restriction that they will not apply if the vacancies are temporary or casual, and are of less than a month''s
duration or arise after the expiry of a period of one year from the date of the retrenchment. Rule 63(2) states that a retrenched workman on receipt
of the notice of the vacancy from the employer, shall offer himself for work or send a reply within a period of ten days from the date on which
notice is posted and, if he fails to do so, he shall lose all his claim for preference in future vacancies, and the employer shall be free to fill up the
vacancies in all cases when retrenched person do not come forward for re-employment. As a third argument it was urged by the learned counsel
for the petitioner that at the time when the first respondent made his application to the Labour Court u/s 33C(2) of the Act, he was no longer a
workman as defined in Section 2(s) of the Act, and, therefore, he could not be given any relief.
(4) I will take up first for consideration the first point about the jurisdiction of the Labour Court u/s 33C(2) of the Act, to deal with an application
of the present kind. The relevant provisions to be applied in this case in Section 33-C as it stood before its amendment in 1964, because the
period in respect of which the petitioner has sought for his relief arose before 1964. Section 33-C(1) and (2) before its amendment read:
33-C. Recovery of money due from an employer :
Where any money is due to a workman from an employer under a settlement or an award or under the provision of Chapter 5-A, the workman
may, without prejudice to any other mode of recovery, make an application to the appropriate Government for the recovery of the money due to
him, and if the appropriate Government is satisfied that any money is so due, it shall issue a certificate for that amount to the Collector who shall
proceed to recover the same in the same manner as an arrear of land revenue.
Where any workman is entitled to receive from the employer any benefit which is capable of being computed in terms of money, the amount at
which such benefit should be computed may, subject to any rules that may be made under this Act, be determined by such Labour Court as may
be specified in this behalf by the appropriate Government, and the amount so determined may be recovered as provided for in sub-section (1)"".
It is clear that Section 33C(2) is wider in its scope than Section 33C(1); Section 33C(2) covers both monetary benefits and also non-monetary
benefits, but the latter must be capable of being computed in terms of money. Section 33C(1), however, deals with a case where money is actually
due to the workman under a settlement, award etc., which is not the case here. Therefore Section 33C(1) can be ruled out, and we have to
consider in this case only the applicability of Section 33C(2). The right for his relief claimed u/s 33C(2) was based by the workman, Sheriff, first
respondent, on the third clause of the settlement which gave him a preferential right for reappointment to vacancies arising within a period of one
year from the date of his retrenchment. This settlement does not purport to operate de hors the statute. Therefore, the preferential right for
reappointment thus secured to the retrenched worker, must be viewed as subject to the restrictions which the statutes, namely, Section 25-H and
Rule 63 of the rules above considered have imposed. The order of the Labour Court, does not show that this argument was advanced before me
by the learned counsel for the petitioner, it was not urged by the learned counsel for the first respondent that the terms of the settlement should be
applied de hors the restriction imposed by the statute. In fact, learned, counsel for the first respondent contended that the evidence supplied in this
case before the Labour Court was sufficient to establish the finding that the new workmen found working in the petitioner''s theatre at the time of
the inspection of the Labour Inspector, had been employed permanently and were not casual workmen. I am inclined to agree with this argument.
P. W. 2 Natarajan, who was a booking clerk in Paragon Talkies, has deposed that the new entrants Chelliah, Shanmugham and Nurullah Basha
were working continuously even though they were given daily wages, and their names were not entered in the muster rolls. They commenced to
work one month after the first respondent''s retrenchment, and out of them, Chelliah left two months before the witness left the service. Therefore,
there is no basis for any possible view that the vacancies were only casual or that they were for periods less than a month''s duration, and hence
that there was no necessity to make an offer of re-employment to the first respondent.
(5) Next it was urged by the petitioner that what the settlement secured to the retrenched workers is only a preferential right to re-employment in
certain contingencies, but such a right cannot be construed as a non-monetary benefit, which is capable of being computed in terms of money.
When a person is employed, he offers to the employer benefit in the shape of his services, and he receive from the employer a return in the form of
salary or wages, and the salary or wages therefore, is not a benefit, but rather a quid pro quo for services rendered, as remuneration therefor.
Learned counsel for the petitioner urged that what the first respondent sought in the application u/s 33C(2), is really compensation for non-
employment in accordance with the terms of the settlement, and until and unless a Court or a judicial Tribunal, has determined the right to receive
such compensation after it has come before it as an industrial dispute, it cannot be held that a non-monetary benefit, whose value can be computed
in terms of money, has accrued to the worker, which can be granted to him by means of an application u/s 33C(2) of the Act.
(6) For this view, learned counsel referred to the decision of the Supreme Court in Punjab National Bank Limited Vs. K. L. Kharbanda, , where
at p. 238 of the report (Lab LJ) = (at p. 490 of AIR) the observation is found that Section 33-C is a provision in the nature of execution. Where
the amount to be executed is worked out (for example in an award) or where it may be worked out without any dispute, Section 33C(1) will
apply. But where the amount due to a workman is not stated in the award itself and there is a dispute as to its calculation, sub-section (2) will
apply, and the workman would be entitled to apply thereunder to have the amount computed provided he is entitled to a benefit, whether monetary
or non-monetary, which is capable of being computed in terms of money. This decision was followed by the Mysore High Court in Vithal Parappa
Murari v. Athani Municipality, 1964 1 LLJ 691, which dealt with a case where a peon claimed that he was retrenched in contravention of Section
25-G of the Industrial Disputes Act, and the question arose whether he was properly retrenched or not. The Mysore High Court held that such a
dispute could not be entertained by the Labour Court u/s 33-C of the Act. The Madras High Court in the decision reported in Natarajan v.
Lakshmi Mills Co., 1964 2 LLJ 296, dealt with a case where in the claim petition u/s 33C(2) of the Act the employee claimed that the nature of
the duties which he performed justified his being placed in a higher category which carried higher wages. He claimed payment of the difference in
the salary between the higher and the lower categories. A Bench of this Court consisting of Chief Justice and Ramamurti, J., following a later
decision of the Supreme Court in The Central Bank of India Ltd. Vs. P.S. Rajagopalan etc., , to which I shall presentely make reference, held that
the real question for consideration in that case was whether the claimants had been wrongfully placed in a particular category, which is not
appropriate to the work that they had been doing, and that such a dispute was outside the scope of Section 33C(2) of the Act.
(6-A) I am of the opinion that these decisions do not have application to the facts of the present case. The first respondent derived his right under a
settlement, which, even if read with the provisions of Section 25-H of the Act as well as Rule 63 of the rules framed by the Madras Government,
granted a definite right of re-employment if certain conditions were satisfied. The first respondent alleged that the necessary conditions had been
satisfied, that there had been a breach of the terms of the settlement by the petitioner, and he sought for payment to him of a certain sum of money
representing the equivalent of the compensation due to him for non-fulfillment of the obligation of re-employment by the petitioner. There was,
therefore, no necessity to obtain a prior adjudication from the Labour Court by way of an industrial dispute of the right of re-employment on
retrenchment. That right was already granted by the settlement. The first respondent wanted a money benefit to be computed and awarded to him
for the deprivation of that right which the petitioner was not prepared to grant to him, because the petitioner claimed that the circumstances
justifying the enforcement of that right did not exist. In other words while the petitioner conceded that the source of the right was the settlement, he
was not prepared to concede the first respondent''s claim that an occasion for enforcement of that right had arisen. The present case bears close
analogy to the decision of the Supreme Court reported in The Central Bank of India Ltd. Vs. P.S. Rajagopalan etc., of the report the Supreme
Court observed:
In our opinion, on a fair and reasonable construction of sub-section (2), it is clear that if a workman''s right to receive the benefit is disputed, that
may have to be determinted by the Labour Court. Before proceeding to compute the benefit in terms of money, the Labour Court inevitably has to
deal with the question as to whether the workman has a right to receive that benefit. if the said right is not disputed, nothing more needs to be done
and the Labour Court can proceed to compute the value of the benefit in terms of money; but if the said right is disputed, the Labour Court must
deal with that question and decide whether the workman has the right to receive the benefit as alleged by him and it is only if the Labour Court
answers this point in favour of the workman that the next question of making the necessary computation can arise.
x x x x x x x
The claim u/s 33C(2) clearly postulates that the determination of the question about computing the benefit in terms of money may, in some cases,
have to be preceded by an enquiry into the existence of the right and such an enquiry must be held to be incidental to the main determination which
has been assigned to the Labour Court by sub-section (2). As Maxwell has observed ""where an Act confers a jurisdiction, it impliedly also grants
the power of doing all such acts, or employing such means, as are essentially necessary to its execution"". We must accordingly hold that Section
33C(2) takes within its purview cases of workmen who claimed that the benefit to which they are entitled should be computed in terms of money,
even though the right to the benefit on which their claim is based is disputed by their employers"".
A similar view has been taken by this Court in Board of Directors of the South Arcot Electricity Distribution Co. Ltd. Vs. K. Mohamed Khan and
Others, , to which I was a party, where it was held that a claim for retrenchment compensation (S. 25-FF) in a case where the liability was
disputed by the employer on the ground that there was no retrenchment in law or in fact, could be entertained by the Labour Court under Sec.
33C(2) of the Act. in the light of the above decisions, I am of the opinion that the dispute in the present case leading up to the claim made by the
first respondent for compensation for non-employment following retrenchment could be decided by the Labour Court in an application u/s 33C(2)
of the Act.
(7) Regarding the further ground that the first respondent was not a workman on the date of the petition before the Labour Court, there is no
substance in it. In Management of the Tiruchi-Srirangam Transport Co. Private Ltd. Vs. Labour Court, Madurai and Another, , Ramachandra
Iyer, J., as he then was observed:
................... in a case of retrenchment compensation, a claim could be made only by a discharged worker. That would also be only a case of an
individual dispute. Therefore, it is clear that the object of the Legislature is to provide for the adjudication of individual claims not necessarily by
persons who are still under the employment of the management but by discharged persons as well"".
In Paragon Talkies v. R. Manickam 1963 1 MLJ 304, Veeraswami, J. held that it is a well-known principle that the status of the party for
purposes of relief on the execution side should be determined as on the date when the right accrued and not on the date on which the right is said
to be enforced and that when that settlement was entered into which was the source of liability for gratuity in favour of the 1st respondent he was
undoubtedly a workman within the meaning of the Act. Here the liability of the petitioner to re-employment or to pay compensation for non-
employment arose under the agreement entered into when the workman was still in the service. That right was enforceable in respect of any
vacancy which might arise within a period of one year. It is immaterial for enforcing the right thus conferred, if the workman at the time when the
vacancy arose was not in actual service, because the relief is traceable to an agreement entered into and a right granted to him at a time when he
was in service.
(8) Learned counsel for the petitioner referred to a decision of Rajagopala Ayyangar, J., reported in The Management of Odeon Cinema Vs. The
Workers of Sagar Talkies and Others, . The facts in that case were entirely different, because the workman there had merely a contract to
employment in his favour, but he had not yet been employed. In such circumstances, it was held that the mere existence of a contract to employ,
did not constitute a relationship of employer and employee, between the parties to the contract, and the employee in that case could not come
within the definition of ""workman"" within the meaning of Section 2(s) of the Act.
(9) In view of the foregoing, I am of the opinion that there are no grounds to interfere with the decision of the Labour Court in this case. The writ
petition, is, therefore, dismissed with costs of the first respondent. Advocate''s fee Rs. 150.
Writ Petition dismissed.